Kentucky Tobacco Farmers to share $100 million
Posted on December 20, 2007
Approximately 198,000 Kentucky tobacco farmers have been in a legal battle against the Lexington Kentucky based Burley Tobacco Growers Cooperative Association for holding back money from its members.
The courts have recently awarded a $100 million judgment in their favor.
The premise behind the case is that when the Burley Tobacco Growers Cooperative Association was formed in 1922, that its members were being represented to distribute the tobacco crop to lots of potential customers in Kentucky, the USA, and the world.
Since the Federal government ended its price support for tobacco, MUCH less tobacco is being sold – and of those Kentucky farms that are growing the crop, most of those are under contract directly with cigarette companies – and the association wasn’t really doing anything for its members.
But, the association did hold a VERY large cash reserve of tens of millions of dollars. The association says that they are required to hold that much in reserve as required by the Federal government for any potential losses on loans made by the co-op Commodity Credit Corp.
The case was filed on December 31 2003 against the co-op, and 54 of its officers and directors.
Kentucky farms and farmers that were a part of the organization can expect to receive approximately $430 each as their proceeds for the case. Attorneys will be allocated 15% and the original 8 plaintiffs that filed the case will receive a special payment in the amount of $10,000 each since it was their efforts that got the ball rolling on this matter in the first place. The case was originally filed in Fayette County District Court, and was later moved to Fayette County Circuit Court.
The one upside for the Burley Tobacco Growers Cooperative is that it avoided being required to be dissolved as was originally demanded by the plaintiffs.
» Filed Under Kentucky Horse Farms and Real Estate Tips, Lexington Kentucky, Louisville KY, Our Horse Farm, Shelbyville KY
Comments
Leave a Reply
